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Japan Names New Governor of Central Bank

Breaking with tradition, the Government tapped a relative outsider on Monday to head the central bank and help steer the nation's troubled economy.

Masaru Hayami, 72, a senior adviser to the Nissho Iwai Corporation, a major trading house, will become the new governor of the Bank of Japan, which is trying to recover from a bribery scandal and impose stability in the financial markets.

An influential manager at the bank was arrested last week and accused of leaking market-sensitive secrets to banks that had entertained him. Within hours, Yasuo Matsushita, the current governor, offered to step down, the latest resignation in a scandal that has already claimed a Finance Minister and Vice Finance Minister. Mr. Matsushita will officially step down after his successor is approved by the Cabinet on Friday, a Government spokesman said today.

Toshihiko Fukui, the senior deputy governor and an expert on banking matters who some had considered a contender for the top job, will also step down. Sakuya Fujiwara, 61, an outsider who is an expert on the economy, author of a book on the bank's governors and a former journalist at Jiji Press, a major news agency here, will step into Mr. Fukui's job, the second-highest post at the Bank of Japan. By reaching outside for new faces, Prime Minister Ryutaro Hashimoto is apparently trying to win back public trust in the scandal-tainted bank.

Traditionally, the central bank governor is picked alternately each year from candidates in the Finance Ministry and the Bank of Japan. But Mr. Hashimoto is said to have been concerned that choosing an insider to the bank or the Finance Ministry would invite criticism that the bank's attitude toward the scandal might not change.

Mr. Hayami, however, is no novice to the central bank. A former executive director at the bank, he worked there for 34 years until he retired in 1981 and became a senior managing director at Nissho Iwai and then president and chairman at the trading firm.